HB5503ham001 97TH GENERAL ASSEMBLY

Rep. Brandon W. Phelps

Filed: 3/26/2012

09700HB5503ham001 LRB097 15518 PJG 67897 a

AMENDMENT TO HOUSE BILL 5503

AMENDMENT NO. ______. Amend House Bill 5503 by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Energy Efficiency Program for State Government Buildings Act.

Section 5. Purpose. The General Assembly finds and declares it to be the public policy of the State to maximize the use of energy efficiency measures in the construction, renovation, and maintenance of buildings owned by the State. In furtherance of this policy, the Capital Development Board and the Department of Central Management Services shall administer an energy efficiency program, to be known as the Energy Efficiency Program for State Government Buildings.

Section 10. Definitions. As used in this Act, unless the context requires otherwise:

"Aggregate simple payback period" means the simple payback period of a set of energy efficiency measures taken together for a building.

"Building" means all contiguous land, together with structures, appurtenances, and improvements thereon that use energy.

"Board" means the Capital Development Board.

"Capital cost avoidance" means savings generated when expenditures of appropriated capital construction or appropriated capital outlay funds are avoided because the budgeted capital improvements or items of equipment are contained within the energy efficiency measures provided by a guaranteed energy savings performance contract.

"Department" means the Department of Central Management Services.

"Director" means the Director of Central Management Services.

"Energy audit" means examination of a building's energy-using systems, energy consumption and costs, occupancy patterns, and operation and maintenance procedures.

"Energy efficiency measure" means any improvement, repair, alteration, or betterment of any building or facility owned or operated by a State agency or any equipment, fixture, or furnishing to be added to or used in any such building or facility that is designed to reduce energy consumption or operating costs and may include, without limitation, one or more of the following:

(1) insulation of the building structure or systems within the building;

(2) storm windows or doors, caulking or weather-stripping, multiglazed windows or doors, heat absorbing or heat reflective glazed and coated window or door systems, additional glazing, reductions in glass area, or other window and door system modifications that reduce energy consumption;

(3) automated or computerized energy control systems;

(4) heating, ventilating, or air conditioning system modifications or replacements;

(5) replacement or modification of lighting fixtures to increase the energy efficiency of the lighting system without increasing the overall illumination of a facility, unless an increase in illumination is necessary to conform to the applicable State or local building code for the lighting system after the proposed modifications are made;

(6) energy recovery systems; and

(7) energy conservation measures that provide long-term operating cost reductions.

"ENERGY STAR" means the voluntary program administered by the United States Environmental Protection Agency and the United States Department of Energy that is designed to protect the environment through the promotion of energy-efficient products and practices.

"Engineering analysis" means a detailed cost-benefit analysis of energy efficiency investments, including a review of potential cost savings through operation and maintenance changes.

"Executive Director" means the Executive Director of the Capital Development Board.

"Guaranteed energy savings performance contract" means an agreement for the provision of energy services or equipment, including energy efficiency measures, energy conservation measures and alternate energy technologies for State government buildings, in which a person agrees to design, construct, install, maintain, operate, or manage energy systems or equipment to improve energy efficiency of, or produce energy in connection with, a State government building. Payments for a guaranteed energy savings performance contract shall be made from measured and verified savings generated from implementation of the energy efficiency measures financed by the contract. The term of a guaranteed energy savings performance contract shall not exceed 5 years. If the measured and verified savings are not sufficient to pay the financial obligations under the contract, the contractor is liable for the contract payments.

"High-performance building" means a State government building that is designed, constructed, and capable of being operated in a manner that:

(1) increases environmental performance and economic value over time;

(2) safeguards the health of occupants;

(3) enhances satisfaction and productivity of workers through energy-efficient systems;

(4) incorporates environmentally friendly materials and products; and

(5) reduces waste.

"Life-cycle cost analysis" means a method for estimating the total cost of an energy-using component or building over its useful life, including cost factors such as purchase price or construction, renovation, or leasing costs, energy use, maintenance, interest, and inflation.

"Low cost/no cost energy conservation measures" means those energy saving practices and energy efficiency measures, usually involving operation and maintenance practices, that can be accomplished by existing personnel within existing operating budgets.

"Operating costs" means expenditures associated with operating and maintaining a properly functioning building and its systems including but not limited to the heating, ventilation, cooling, lighting, plumbing, water heating, electrical, and laundry systems and their controls.

"Qualified provider" means a person or business whose employees are experienced and trained in the design, implementation, or installation of energy conservation measures.

"Request for proposals" means a competitive selection achieved by negotiated procurement.

"Simple payback period" means the number of years it takes to pay back, from estimated savings, the initial cost of an energy efficiency measure with the simple payback period equal to the initial cost divided by the estimated annual savings.

"Savings" means the reduction in expenditures, excluding any State government and university personnel expenditures, that are measured and verified, including but not limited to energy usage, operating costs, and capital cost avoidance that occur as a result of the implementation of energy efficiency measures.

"State agency" means the Department of Central Management Services.

Section 15. Authority of the Capital Development Board.

The Capital Development board shall have the authority to act on behalf of any State agency in accordance with this Act.

Section 20. Energy Efficiency Program for State Government Buildings.

(a) The Energy Efficiency Program for State Government Buildings shall provide for implementation of low cost/no cost energy conservation measures, engineering analyses, energy efficiency measures, building improvements, and monitoring of results for State-owned buildings.

(b) Any engineering analysis conducted on a State-owned building shall assess the energy efficiency of the building and make recommendations for improving the efficient use of energy within the building. The analyses shall be performed by individuals licensed under the Illinois Architecture Practice Act of 1989, the Professional Engineering Practice Act of 1989 or the Structural Engineering Practice Act of 1989.

(c) Measures to improve the energy efficiency of a State-owned building that have an aggregate simple payback period of 5 years or less shall be implemented subject to appropriation. No more than 5% of the cost of energy efficiency measures for a building may be used for monitoring the results.

(d) If funds are appropriated for energy efficiency improvements, the Board shall prioritize projects among the various State-owned buildings to determine which projects shall be implemented to best use the available funding.

(e) The savings in reduced expenditures that are specified as payment sources shall be documented in the guaranteed energy savings performance contract. Savings shall be determined by using one of the measurement and verification methodologies listed in the United States Department of Energy's "International Performance Measurement and Verification Protocol". If specific data limitations or documented unique characteristics of the project prevent use of the "International Performance Measurement and Verification Protocol", an alternative method that is compatible shall be adopted upon documentation and approval of the Director.

Section 25. Energy audit training program. The Department shall institute an energy audit training program to identify energy saving techniques for State-owned building maintenance staff. Additional programs shall be developed to educate State employees and other building occupants on energy awareness and practices to reduce energy use in State-owned buildings. Local government employees may be included in training and educational programs.

Section 30. Life-cycle energy cost analyses. The Board shall require persons submitting bids or plans for State-owned buildings to be constructed or substantially renovated after July 15, 2013, to include within those bids or plans life-cycle energy cost analyses. The Board shall consider those life-cycle cost analyses when evaluating competing bids or plans.

Section 35. Report on energy efficiency measures in State government. The Department shall report on or before October 15, 2013, and on or before every October 15 thereafter to the Legislative Research Unit and the Commission on Government Forecasting and Accountability on progress made to maximize the use of energy efficiency measures in State government. The Commission on Government Forecasting and Accountability shall transmit the report to the Speaker of the House of Representatives, the Minority Leader of the House of Representatives, the President of the Senate, and the Minority Leader of the Senate. The report shall include but not be limited to:

(1) a summary of initiatives undertaken by the Board during the reporting period to promote adoption of low cost/no cost energy efficiency measures, including employee training efforts;

(2) a summary of energy efficiency measures installed and energy improvements made during the reporting period;

(3) energy consumption and expenditure data for facilities owned by State government and any documented savings made as a result of energy efficiency measures and improvements;

(4) a status report on the number of buildings newly constructed or renovated in accordance with the high-performance building standards required under this Act and the amount of savings realized based upon a life-cycle cost analysis;

(5) any efforts made during the reporting period to promote acquisition of energy efficient products pursuant to this Act and the amount of savings expected to be realized in the first year of operation from the purchase of ENERGY STAR-qualified products pursuant to this Act;

(6) any recommendations for future funding of energy improvements or other measures needed to assure energy efficiency in State government; and

(7) any improvements in energy efficiency planned or realized through the use of ENERGY STAR-qualified products and guaranteed energy savings performance contracts.

Section 40. Energy Efficiency in State Government Buildings Fund.

(a) A special fund in the State treasury is hereby created which shall be known as the Energy Efficiency in State Government Buildings Fund. The Fund shall be used to provide financial assistance to State government agencies for the purposes of this Act. Notwithstanding any other law to the contrary, the Energy Efficiency in State Government Buildings Fund is not subject to sweeps, administrative charge-backs, or any other fiscal or budgetary maneuver that would in any way transfer any amounts from the Energy Efficiency in State Government Buildings Fund into any other fund of the State.

(b) The Fund may receive State appropriations, gifts, grants, and federal funds and shall include earnings from the investment of moneys in the Fund.

(c) Administration of this Fund shall be the responsibility of the Board. The Board shall establish terms and conditions for the operation of the Fund including the application process. The Board shall establish and implement fiscal controls and accounting periods for projects that receive financial assistance from the Fund.

Section 45. Administrative rules. The Board may implement the provisions of this Act through the promulgation of administrative rules pursuant to the Illinois Administrative Procedure Act.

Section 50. Prequalification; qualified providers.

(a) The Capital Development Board shall establish procedures to prequalify firms or entities seeking to provide services under performance and guaranteed energy savings performance contracts and ensure such firms are qualified providers of such services.

(b) The minimum training required for a qualified provider under this Section shall be the satisfactory completion of at least 40 hours of course instruction dealing with energy conservation measures. A qualified provider to whom the contract is awarded shall give a sufficient bond to the State agency or area vocational center for its faithful performance. All design services shall be procured in accordance with the Architectural, Engineering, and Land Surveying Qualifications Based Selection Act.

Section 55. Request for proposals. The request for proposals shall be administered by the Capital Development Board and notification of the procurement will be accordance with the Illinois Procurement Code, but in no case shall the Board provide less than a 30-day notice of the request for proposals. Proposals submitted shall be sealed. The request for proposals shall include all of the following:

(1) the name and address of the proposed project;

(2) the name, address, title, and phone number of a contact person;

(3) notice indicating that the State agency is requesting qualified providers to propose energy conservation measures through a performance or guaranteed energy savings performance contract;

(4) the date, time, and place where proposals must be received;

(5) the evaluation criteria for assessing the proposals; and

(6) any other stipulations and clarifications the State agency may require.

Section 60. Evaluation of proposals. Before entering into a performance or guaranteed energy savings performance contract, a State agency shall submit a request for proposals. The Capital Development Board shall evaluate any sealed proposal from a qualified provider on behalf of the State agency. The evaluation shall analyze the estimates of all costs of installations, modifications, or remodeling, including, without limitation, costs of a pre-installation energy audit or analysis, design, engineering, installation, maintenance, repairs, debt service, conversions to a different energy or fuel source, or post-installation project monitoring, data collection, and reporting. The evaluation shall include a detailed analysis of whether either the energy consumed or the operating costs, or both, will be reduced. The evaluation of the proposal shall be done by a licensed professional engineer or architect who is retained by the Capital Development Board and selected in accordance with the Architectural, Engineering, and Land Surveying Qualifications Based Selection Act. A licensed architect or registered professional engineer evaluating a proposal under this Section must not have any financial or contractual relationship with a qualified provider or other source that would constitute a conflict of interest.

Section 65. Award of contract.

(a) Sealed proposals must be opened by the Capital Development Board at a public opening at which the contents of the proposals must be announced. Each person or entity submitting a sealed proposal must receive at least 14 days notice of the time and place of the opening. The Capital Development Board shall select the qualified provider that best meets the needs of the State agency. After evaluating the proposals under Section 60, the Capital Development Board may enter into a guaranteed energy savings performance contract with a qualified provider if it finds that the amount it would spend on the energy conservation measures recommended in the proposal would not exceed the amount to be saved in either energy or operational costs, or both, within a 5-year period from the date of installation, if the recommendations in the proposal are followed. Contracts let or awarded must be published in the Illinois Procurement Bulletin.

(b) The request for proposals and any contracts awarded to a qualified provider shall require that any subsequent need for architectural, engineering, or land surveying services that arises after the submittal of the request for qualifications, the request for proposals, or contract award shall be procured by the provider using a qualifications based selection process consisting of publication of notice of availability of such services, a statement of desired qualifications, an evaluation based on such desired qualifications, and the development of a shortlist ranking the firms in order of qualifications, and then negotiations with such ranked firms for a fair and reasonable fee. Compliance with the Architectural, Engineering, and Land Surveying Qualifications Based Selection Act shall be deemed prima facie compliance with this subsection. Every performance or guaranteed energy savings performance contract shall incorporate the requirements of this subsection.

(c) The request for proposals shall require that each and every contractor, subcontractor, and architectural, engineering, and land surveying firm or entity shall be listed and the quotation or price for such services shall also be listed. If, prior to or after the award of the contract, any of the listed firms shall have a reduction in their listed price, the performance or guaranteed energy savings performance contract shall be modified and such savings shall be for the benefit of the State agency with a corresponding reduction in the contract amount. The information in the request for proposals shall be considered confidential and only for the use of the State agency.

Section 70. Guarantee. A guaranteed energy savings performance contract shall include a written guarantee by the qualified provider that either the energy or operational cost savings, or both, will meet or exceed, within 5 years, the costs of the energy conservation measures. The qualified provider shall reimburse the State agency for any shortfall of guaranteed energy savings projected in the contract. A qualified provider shall provide a sufficient bond to the State agency for the installation and the faithful performance of all the measures included in the contract. The guaranteed energy savings performance contract may provide for payments over a period of time not to exceed 5 years from the date of final installation of the measures.

Section 75. Disclosures. A State agency may not withhold the disclosure of information related to (i) the State agency's consumption of energy, (ii) the physical condition of the State agency's facilities, and (iii) any limitations prescribed by the State agency.

In accordance with Section 50-10.5 of the Illinois Procurement Code, no contractor that participated in the preparation of the specifications issued by the State agency shall be permitted to respond to the solicitation or be awarded a performance or guaranteed energy savings performance contract. The solicitation must include a written disclosure that no energy services contractor participated in the preparation of the specifications. The written disclosure shall be published in the Capital Development Board's volume of the Illinois Procurement Bulletin with the request for proposal.

Section 80. Operational and energy cost savings. The Department shall document the operational and energy cost savings specified in the guaranteed energy savings performance contract. If the annual energy savings are less than projected under the guaranteed energy savings performance contract the qualified provider shall pay the difference in accordance with Section 70.

Section 85. Bonding. A qualified provider shall provide a sufficient bond to the State agency for the installation and the faithful performance of all the measures included in the contract in accordance with the Public Construction Bond Act. Such bond shall be in effect for the entire term of the contract.

Section 90. Applicable laws. Other State laws and related administrative requirements apply to this Act, including, but not limited to, the following laws and related administrative requirements: the Illinois Human Rights Act, the Business Enterprise for Minorities, Females, and Persons with Disabilities Act, the Prevailing Wage Act, the Employment of Illinois Workers on Public Works Act, the Freedom of Information Act, the Open Meetings Act, the Illinois Architecture Practice Act of 1989, the Professional Engineering Practice Act of 1989, the Structural Engineering Practice Act of 1989, the Architectural, Engineering, and Land Surveying Qualifications Based Selection Act, the Contractor Unified License and Permit Bond Act, the Procurement of Domestic Products Act, the Public Purchases in Other States Act, the Governmental Joint Purchasing Act, the Design-Build Procurement Act, the State Prompt Payment Act, the Public Contract Fraud Act, the Public Construction Contract Act, the Airport and Correctional Facility Land Disclosure Act, the State Real Property Leasing Act, the Real Estate Leasing Act, the Project Labor Agreements Act, and the provisions of Article 50 of the Illinois Procurement Code.

Section 95. The State Finance Act is amended by adding Section 5.811 as follows:

(30 ILCS 105/5.811 new)

Sec. 5.811. Energy Efficiency in State Government Buildings Fund.

Section 100. The Illinois Procurement Code is amended by changing Section 30-45 as follows:

(30 ILCS 500/30-45)

Sec. 30-45. Other Acts. This Article is subject to applicable provisions of the following Acts:

(1) the Prevailing Wage Act;

(2) the Public Construction Bond Act;

(3) the Public Works Employment Discrimination Act;

(4) the Public Works Preference Act (repealed on June 16, 2010 by Public Act 96-929);

(5) the Employment of Illinois Workers on Public Works Act;

(6) the Public Contract Fraud Act;

(7) the Illinois Construction Evaluation Act; and

(8) the Project Labor Agreements Act; and .

(9) the Energy Efficiency Program for State Government Buildings Act.

(Source: P.A. 97-199, eff. 7-27-11; 97-333, eff. 8-12-11.)

Section 999. Effective date. This Act takes effect upon becoming law.".